Philippines - Vocational training for operatives and craftsmen

Report No. 8259-PE PHILIPPINES VOCATIONAL TRAINING FOR OPERATIVES AND CRAFTSMEN January 24, 1990 Population and Human Resources Division Country Department II Asia Regional Office  050-22(1) PROSSER SR-044.TOC JP:MSGiDBtJP(3)BWC3JP:BWC(2) 01-24-90 CURRENCY EQUgVALENTS Currency Unit - Peso (P) US$1 - P 21.00 P 1 - US$0.05 (as of February 1989) FISCAL YEAR January 1 - December 31 SCHOOL YEAR June - March ACRONYMS ENFE Bureau of Non-Formal Education BTYE Bureau of Technical and Vocational Education CLACDA Camarin Livelihoood and Community Development Association CTC Community Training Center DA Department of Agriculture DAR Department of Agrarian Reform DECS Department of Education, Culture and Sports DLG Department of Local Government DOLE Department of Labor and Employment DSWD Department of Social Welfare and Development DTI Department of Trade and Industry DTS Dual Training System GITP Garment Industry Training Program IB Industry Board MTU Mobile Training Unit 5CNFE National Committee for Non-Formal Education NEDA National Economic Development Authority RFE Non-Formal Education NGO Non-Governmental Organization SKYC National Manpower and Youth Council NSTC National Skills Training Center OSY Out of School Youth PBSP Philippines Business for Social Progress PCNFE Philippines Center for Non-Formal Education PLACER Placement Assistance Center PMDO Provincial Manpower Development Officer PMTC Provincial Manpower Training Center Regions I-XII Refers to administrative districts BMTC Regional Manpower Training Center RTO Regional Training Officer SEAW Self-Employment Assistance Worker TCS Training Contract Scheme TECH-VOC Technical-Vocational (schools) TEI Technical Education Institute TLS Training Levy System TT I Trade Test Class I for supervisory staff  #50-22(1) PROSSER SR-044.TOC JP:MSG:DBsJP(3)BWCtJPsVWC(2) 01-24-90 TT II Trade Test Class II for skilled craftsmen TT III Trade Test Class III for semi-skilled artisans VTIL Vocational Training Instructor's Licence i  150-22(1) PROSSER SR-044.TOC JP:HSG:DB:JP(3)BWC:JP:BWC(2) 01-24-90 PHILIPPINES VOCATIONAL TRAINING FOR OPERATIVES AND CRAFTSMEN SECTOR STUDY Table of Contents Page No. EXECUTIVE SUM2ARY .... . . . ...... . . . . . . . . . . . . I. UNTRODUCTION .1... . . . . . . . . . . . . . . . . . . . . II. BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . 2 A. Socio-economicBackground ............... . 2 B. Current Training Approaches and Programs . . . . . . . . 7 III. CRITICAL ISSUES AND STRATEGIES . . . . . . . . . . . . . . . 21 A. Meeting the Manpower Needs . . . . . . . . . . . . . . . 21 B. Improving Relevance and Quality of Training . . . . . . . 24 C. Efficiency and Financial Issues . . . . . . . . . . . . . 28 D. Planning Issues .... . . . . . . . . . . . . . . . . . 35 E. Institutional Issues ... . . . . . . . . . . . . . . . 38 IV. CONCLUSIONS ........................ . 41 ATTACHMENT 1: Summary of Recommendations ATTACHMENT 2: NMYC Early history. Legal Basis, Structure and Organigrams ATTACHMENT 3: Examples of Training Programs and Organizations for Women and Girls ATTACHMENT 4: ORGANIGRAMS 1. NYMC Institutional Arrangements for Manpower Policy and Planning 2. Organization of NMYC Secrerariat 3. Camarin Livelihood and Community Development Association MAP: NMYC Regional Offices  050-22 PROSSER SR-044.TOC JPsHSG:DB(2):JP(4):BWC(2): 01-24-90 PHILIPPINES VOCATIONAL TRAINING FOR OPERATIVES AND CRAFTSMEN SECTOR STUDY EXECUTIVE StQMARY Background i. The main objectives of this study are to identify and suggest ways to resolve key issues in the training of operatives and craftsmen in urban and rural areas for both wage- and self-employment. The study describes and critically examines the main training delivery systems in the public and private sectors and the particularly important role of non-governmental organizations (NGOs) in rural training in the Philippines. ii. A major impediment was data limitations. It was already recognized that employment data were weak or non-existent and that the study (for external efficiency purposes) would therefore have to be "supply-oriented'. It proved, however, that there were also serious liwitations on reliable "training' data of all kinds, which became an issue addressed by the study. An important consequence of the absence of sound basic data is that it was not felt possible to put forward any firm conclusions on the need for expanding training for operatives and craftsmen particularly for the modern sector or on external efficiency. In exploring the need, h3wever, for rural basic training particularly in addressing training for youth and women the absence of hard economic data to justify expansion is, from international experience, typically difficult to collect. References are less cautious in proposing an expansionary strategy where a social justification is as valid as a strictly economic one. Socio-economic Setting iii. After a decade in which the Philippines turned from one of the region's most dynamic economies to one of its most troubled, the new Aquino government is attempting to put in place a revitalizing socio-economic development strategy that, inter alia, places a new emphasis on human resource development and vocational education and training (VET). However, there has not as yet been an employment survey, and data on present and future employment needs are scarce and of poor quality. Nevertheless, indications are that new export promotion policies are showing signs of success, led by industries such as garment manufacturing and electronics. To a lesser extent, policies designed to re-invigorate the rural areas through small-scale industrial growth are also having an impact. iv. An initial study (1988) conducted by the Department of Industrv (DTI) in collaboration with the Department of Labor (DOLE) and the National Hanpower and Youth Council (NMYC) indicates a need for more than 200,000 new operatives and craftsmen annually to support the new economic efforts in the short-term,  #50-22 PROSSER SR-044.TOC JP:MSGiDB(3):JP(4)tBWC:JP:BWC 01-24-90 - it - besides the need for retraining and upgrading of existing cadres.l/ Employment data on the informal rural sector are not available. Rural employment opportunities are mainly for self-employment. However, *outreach" modern sector wage employment in small-scale rural industrial/programs are expanding because of low rural wage rates. These call for operative and craftsmen skills in such fields as garment and handicraft development as well as for self-employment. v. The new government's short-term strategy for lower and middle-level manpower development has been to rejuvenate and to use existing institutional training arrangements while at the same time to review and assess their relative potential for improvement and expansion and identify weaknesses and ways to address these. This study forms a significant part of this strategy which on the basis of existing data and institutional conditions should help articulate a broad policy and institutional framework with specific actions for government's consideration to build up the supply of well-trained operatives and craftsmen. The Vocational Training Scene vi. Two public sector training agencies dominate the formal modern industrial and rural scenes. The first, the NMYC, is the most significant, as it has both major staff' and slines functions. The NKYC training program. which is built on flexible six-month and shorter courses, is the largest of all programs with an annual output of more than double all other programs together. The second is the Department of Education, Culture and Sports (DECS). DECS, in parallel with its general education activities, has two Bureaus dealing with training. The Bureau for Technical and Vocational Education (BTVE) manages formal one- and two-year, post-secondary programs and programs to train low- level technician level 3 and 4 year program. The Bureau for Nonformal Education (BNFE) conducts basic skills training in conjunction with broad-based literacy. A number of other government departments have smaller programs which include specialized vocational training such as the Department of Trade and Industry (DTI) and the Department of Social Welfare (DSWD). vii. Little data exist on the private industrial sector. which with the exception of the large multi-nationals. has very limited training capacity. Private industrial training capacity is typically being fostered by and linked to the NMYC through 'subsidized, programs such as the Training Contract Scheme (TCS) and Industry Board Enterprise Based Training Program (IB). The principle of government subsidy to industry for training is based, apparently, on a perceived weak institutional capability, reflecting partly the small size of industrial enterprises. In addition to with-in industry training, there are a variety of private training institutions ranging from a few very good institutions typically linked to the private universities (and often 'feeders' for university engineering courses) to others run on a profit-making basis, typically poorly equipped and generally 'offering poor quality training. 1/ This only includes larger industries and does not include labor emigration which is sizeable. However, the methodology used, basically extrapolation of past trends, does not provide enough hard data to justify a firm expansionary training strategy.  150-22 PROSSER SR-044.TOC JPsMSGsDB(3)sJP(4)sSWCtJPsBVC 01-24-90 - iii - viii. Rural non-formal training is typically basic and ad hoc. The public sector plays throughout the country both an enabling and direct training role. Programs respond to social demand and are characterized by flexibility, Ingenuity in the use of resources, and smallness, each being effectively tailored to local needs but in totality meeting only a small proportion of local demand. The main departments engaged in rural basic vocational training include the BNNE (DECS), the Department of Social Welfare and EMYC through its community training program (CTP). These public bodies work closely with each other at the local level and with the great variety of NGOs. An important characteristic of rural training is the strong presence of the nationally organized NGOs and local commmity self-help groups that organize training at local levels as part of their broad community service activities. These organizations work together and though hard evaluative data do not exist, programs are driven by local felt needs, are run efficiently, and, though small in relation to needs, apparently address those needs. Strengths and Areas for Further Improvement ix. A number of positive features mark the Philippine VET scene. First, the NMXC as a quasi-government national training support and development institution, is an unusual and valuable asset to VET. Through Statutory Act, it has been assigned the authority for national policy work, executing critical support *staff' functions across the VET subsector including macro and micro manpower planning and training needs assessment, skills testing placemetit and guidance technical advice and support to training agencies in industry. It also has statutory power to undertake coordination functions and experimental work in the VET field and has since the 19609 played a major role in these areas. Indeed, the diversity of training agencies, with DECS, DTI and other as well as NkYC responding to special training needs and to their particular strengths, is a dimension of this positive feature. The Council has representation from all training and training support agencies; it also has a Secretariat with a large national and local structure and staffing establishment to advise on and execute training policies and programs. It has also developed its own "line' training through regional, provincial and local training institutions which provide training at craftsmen and operative levels close to industry and the rural scene. This means that the external efficiency of the NMYC program is reasonable as is its internal efficiency. X. Second, some aspects of institutional support to YET are well developed. These include, for instance, NMYC work on program and curriculum development, where at the provincial and village levels (CTP) local training can be designed to match needs with flexibility; and training quality standardization and trade testing, with 182 occupational skills standards having been developed and 17 skill trade testing systems. xi. Thirdly, an unusually strong tradition of private sector NGO participation in rural and poverty-focussed-urban training has evolved, together with generally harmonized training being provided by the public sector the BNFE and DSWD. This training endeavor is capable of further expansicn on a collaborative basis. xii. These strengths notwithstanding there are serious weaknesses also evident in the VET system at present.  #*0-22 PROSSER SR-044.TOC JPiMSG:DB(3)sJP(4)%BWCtJP:BWC 01-24-90 - iv - ZUi. First, it is clear that the VET system is far from reaching its potential. The major training and support institutions have suffered severely from neglect and under-financing during the years of political uncertainty and economic decline preceding the 1986 revolution. It is not yet clear that the malaise besetting the VET institutions hae been overcome in the post-revolution years or that key institutions, such as NMYC (particularly in its staff role) and DECS (particularly in its one- and two-year courses), that are critical for supporting the country's economic development aims, are capable of providing the trained manpower policy work, planning or program development effectively. The situation is perhaps more serious and complex in relatio- to the modern and typically more urban-oriented industrial basic and middle-level skills training subsector than in nonformal basic skills training to support rural development. Ziv. There are three groups of fundamental issues affecting VET. The first in importance, though not the most urgent, are institutional issues such as how to build up planning and management capacity. The second group--perhaps most urgent--relates to the selection of the best delivers system to meet manpower needs for the modern industrial sector. A related issue is the quality of training and its relevance to labor market needs. Alternative solutAmns to these issues all have a financial dimeusion. These constitute the third group of issues: the most effective ways to make existing financial resources go further nd how best to increase the total financial and other resources for trainins. Similar issues characterize rural basic training although there are differences of impact. For instance, the skills gap in rural development is more difficult to quantify and training needs are typically reflected as social demand, with self-employment as the personal goal as well as paid employment in enterprises. The shortage of resources for rural training is very apparent. Relevance, however, is typically less of an issue as almost all programs are tailored to a felt community need. A key issue in the rural subsector is the most appropriate role for the public sector and how best to encourage NGOs in an activity where they are currently performing well, but where government support is suspect or conversely could lead to unhealthy dependency. Xv. Institutional Issues. A serious and basic weakness in the VET field is institutional. This weakness begins with a lack of reliable and consistent raw data on such central concerns as labor market needs, training places and capacity, output of trainees, and trainee wastage rates. This makes planning both at the national and local levels impossible. The planning and evaluation currently being undertaken is of little value and a major overhaul is required and a data bank, data management, planning and evaluation system built up. Attention must be paid to a serious lack of professional economists, planning staff, statisticians aad managers capable of interpreting data and plans as well as executing them at all levels of VET from the macro 'national" level to the grass-roots. This lacuna is particularly evident in NMYC, which has the mandate fcr policy. planning and programmatic work. It is not clear that the problem is entirely one of the level of NMYC staffing or lack of funding. It appears as much a lack of professional competence in the agency. These weaknesses are also evident in BTVE and BNFE and have been noted as a general weakness in DECs in the Education Sector Study recently completed by the Bank. A review is needed urgently of the system of data gathering, analysis and inte.pretation in the  #50-22 PRMSSER SR-044.TOC JPtMSG:DB(3)tJP(4):BWC:JPsBVC 01-24-90 planning and finuncing context. This need not take long. Following this a staffing review and strengthening program can be designed and planning rebuilt on a firm base with a firm linkage between labor wrvket needs and training programs. xvi. Issues of Industrial Training) Modest Relevance and Needs. The key Issue is how and through which delivery system can more and better operatives and craftsmen be produced. A review of external and internal efficiency of institutional programs is critical. xvii. In this context, the duplication of training between the BTVE one- year and two-year programs and the NHYC courses must be reviewed and resolved. (Technician training has not been addressed in this study, the NMYC appropriately makes no claim on undertaking technician training and the BTVE has a clear mandate through its Technical Institutes to undertake this type of training). 'While BTVE one- and two-year courses are for post-secondary school graduates and NMYC has no formal education limitation on entry to its programs, both BTVE and NYMC programs cater for the same part of the labor market. The duplication raises issues of resource allocation and in a sub-sector beset by financial constraints, only the most cost-effective programs can be supported. xviii. On the side of relevance or external efficiency, the main problem appears to be with the one- and two-year courses of DECS and BTVE. BTVE has carried out no recent tracer studies of their graduates in job placement. but a small industrial employer study was conducted by the Bank miss.on in and outside Metro Manila. This survey was limited and ad-hoc and insufficient to make definitive conclusions on exernal efficiency. However, unanimously, the industrial employers complained of BTVE graduates being too theoretical and poor technically and that they generally preferred NMYC graduates whose training is almost completely practical. Employers went further and cowrented on their general need for more 'multi-purpose' workers, who are more difficult to produce in the highly structured BTVE operative and craftsman courses. It was noted by the mission from the limited evidence, that a higher proportion of entrants to the labor markets came from NMYC than BTVE, and that it was common for BTVE graduates to enter NMYC courses as a remedial bridge to employment. BTVE has begun to set up industry committees for each of its schools but there is yet insufficient experience to evaluate their impact. It is worth noting that about 5OS of the NMYC trainees are already in jobs and are being trained through the industry training contract and the enterprise-based training programs. No review was made of the BTVE agriculture and fisheries training programs or of the new technician training programs which may not be beset by the same problems as the industrial one- and two-year courses. xix. Internal efficiency indicators also suggest that NKYC programs are significantly more cost-effective than BTVE's industrial training programs. BTVE has significantly higher trainee unit costs; BTVE programs are less flexible or adaptable to industry needs and instructors are less practical; BTVE physical facilities and equipment are inferior; and BTVE has a higher (too high) trainer-trainee ratio. Thus, evidence is strong that for craftsmen and operative training, BTVE is a poor investment. xX. Three alternatives offer possibilities for improving the situation. These include: (a) continue with the present dual system and improve NMYC  J05-22 PROSSER SR-044.TOC JPtMSGtDB(3):JP(4)sBWC:JPtBWC 01-24-90 - vi - programs and rationalize BTVE programs; (b) phase-out less efficient BTVE courses; and (c) permit the two to continue but focus growth on NHYC as the more efficient. Considerations to be taken into account includes (a) BTVE is making efforts to improve the relevance of its courses, though there must be real doubt that the rigid, monolithic structure of DECS can be sufficiently sensitive to the flexibility requirements of course development and to tailoring training to the different skill and variety of local needs; (b) DECS has a significant enough and major task in managing its general education system and could properly use its capacity for strengthening its informal and technician training; (c) there is a question of the capacity of NMYC to assume full responsibility to meet the labor market shortfall in the short-term. A medium- term (5 or more years) period would be needed by NHYC to build up its capability and capacity in quality trainung and to transfer to industry a larger share, while it simultaneously builds up its *staff' support work; and (d) a discon- tinuation of the BTVE courses involves a significant political decision, as tech-voc schools are widely dispersed throughout the country, are viewed locally as training vehicles for local secondary leavers, and teachers have to be redeployed. xxi. The most practicable strategy is the third alternative, with a clear policy of developing NMXC as the agency for training at this level, with industry taking on more enterprise-based training and with a short-term option of permitting the weaker delivery system (BTVE) to continue temporarily (say five years) while the capacity of the NMYC is developed and to permit a rationalization of the sector. xxii. Finance and Resource Issues. A serious finance and resource issue exists and there is evidence of severe underfunding. For instance, in 1987 less than US$0.45 million was allocated by DECs to !ts vocational and technical training bureau for capital and recurrent purposes. This is less than 22 of the DECs budget compared to other countries of the region with an average of 5Z. The DECS budget was only 182 of the total Government budget and the per capita budgetary allocation was less than US$20 (1988) while other countries of the Region such as Bangladesh, China, Thailand were spending at least ten times that amount in equivalent programs. NNYC was allocated less than US$0.15 million in that year. Evidence on expenditures are that DECs does not get its full allocations, and budgets can be significantly larger than actual expenditures. It is unrealistic to ezpect much improvement in the overall level of public funding. xxiii. A fundamental policy issue exists on the role of industry in funding its own training. The incentive system to encourage industry to undertake and/or finance its own training can be strengthened through focussed tax concessions, cost-sharing with the public sector through apprenticeship. Public funding of training is too small and the quality of training is suffering from low capital funding and inadequacy of equipment and training materials. There is no tradition of private industrial funding of training. There are, however, opportunities for: (a) reducing the government contribution to NMYC-managed training funding support in the training contract scheme and increasing the private funding; (b) introducing trainees' fees where the job markets are strong (e.g., for overseas employment, computers, etc.); (c) introducing 'by industry" contributory training funds where training funds can be allocated and managed by each industry; (d) improving internal efficiency measures; and (e) harnessing  t50-22 PROSSER SR-044.TOC JPsMSGsDB(3)tJP(4)s BWCJPsBWC 01-24-90 _ vii - the resources of NGOs more systematically by removing constraints, building-up linkages between them, and providing concessions such as tax exemptions. Toward a Training System xxiv. An adequate training system should have the minimal qualities of (a) training program sensitivity to changing labor mar!et needs; (b) systemic flexibility and adaptability with skilled managers, planners and implementators with foresight; (c) mechanisms for ensuring quality planning and managing in national and local levels; (d) self-sustaining growth through program evaluation, research and development and feedback; (e) the ability to cater for pre-service training, in-service training, and retraining; (f) an allocation of responsibilities that permits the employer a maximum of influence over the training agencies and industry; (g) a funding system that encourages employers to bring requisite pressure on trainers to provide what is needed--best served when the employer is paying which is the major source of training agency income. XXv. In the Philippine context, the basic elements of a satisfactory system exist though they are fragmented and some critical gaps exist not because they have been overlooked in the systemic view but because they are not performed or are performed inadequately. Were the system to be working smoothly, the NMYC would be implementing its policy and staff support functions and through its multi-agency Council guiding the smooth functioning of the system, coordinating overall planning, pin-pointing weakness, developing strengths of its member 'line' agencies and providing a clear picture of health of the sub-sector to government and its members on a regular basis. it clear policy would exist, with a strategy designed to encourage industry to take up greater share of the training burden and its funding, with NMYC playing a key role in creating the conditions for greater private sector responsibility. The public sector, long-term, would still have a role through the school system and such programs run by NMYC for pre-service preparation and over time would phase-out their 'in-service' functions. The public sector and perhaps new specialized institutions driven by industry demand and finance will have a role in specialized training such as currently executed by DTI. In rural non-formal training, the public sector will have a longer term role through working through NGOs and gaining access to as many local resources as possible. DECS, BNFE, and DSVD will continue for long with staff Oenabling" and line roles. The whole system would build on the already evident flexibility and responsiveness to the diverse and continuously changing needs. xxvi. A recommended strategy should include: the Council, with advice from the Secretariat, determining the distribution of training responsibilities between organizations, paying particular attention to the overlap between DECs and NMYCs and assisting DECs' withdrawal from operative and craftsmen training. Special attention must be given and decisions made on the modes for providing incentives to industry and the possibility of expanding these where they are judged worthy with the goal of ultimately transferring appropriate programs and/or costs to industry. xxvii. NMYC must be further assisted to do the fundamental job for which it was created, and as foreseen by Congress (perhaps with a membership update to give a stronger representation to industry and NGOs), must provide planning. The Council members must coordinate the system and through the Secretariat  050-22 PROSSER SR-044.TQC JPsMSGsDB(3):JP(4):BWC:JPtBWC 01-24-90 viii i determine priorities and distribute *staff* support activities such as planning staffing development and new training methodology innovation. xxviii. The 'line' development of the training system must take into account the roles of the three main groups involveds the public sector (NMYC, DECs, DTI. DSWD), the NGOs and private industry. The public system being developed through NMYC provides for a regionsl NMYC office and training center for vZApport to *staff^ work, and 'line' training Below the national/regional structure, a second tier of PTCs will provide foci for meeting local organizational, administrative and training needs. The PTCs in turn, would backstop and help manage the very successful 'outreach' CTP village training programs. Thi6 is reasonable but its success is predicated on the a5ility of NMYC to work with the other agencies at all levels and provide support services they need to run their own programs. xxii. Within this frame there must be scope for other agencies (DTI, DSDW, etc.) to experiment with and run their own programs of training. Indeed, the NKYC chould and does encourage this in the same way that they are encouraging the decentralization of planning. However, this should be done within a systems framework that would help avoid duplication of effort and which encourages sharing of assistance and experiences provided by the MNYC. sxx. A program needs to be developed urgently to assess cost-effectiveness. provide continuous assessment of existing training modes and to build-up evaluation capacity in NKYC and in the training agencies themselves. xxxi. Finally, a clear policy statement by the Council is required on the financing of the training system. While the existing evidence points to continuing and increasing support of Government for: (i) pre-service preparation through the general education in DECS. generic basic training through the system of NMYC centers and out-reach and support to NGOs; (ii) updating of the core training needs to reflect new technologies and demand for multi-skilled workers; and (iii) as a priority for the small infant firms with no training capacity. Industry however as a matter of policy should be prepared to bear the cost of specialized training for operatives and craftsmen which could be achieved either through training - within - industry schemes or supporting NMYC through fee payment for their servicc._. The training contract and enterprise based schemes are capable of and deserving of expansion. Close collaboration with industry and NGOs is vital, not least in cost-sharing, incentives to industry for training development and for fostering the grass-root flexibility of the NGOs. Close collaboration with BTVE in linking the operative and craftsman trrining system to higher level technician and technical training system and arith DTI, BNFE, and DSWD at more basic and rural levels is vital.  #50-22(2) SR044VOC.SEC JP(3)M:SG(2)tBWC(2):DB(2):BWC 01-24-90 I. INTRODUCTION objectives 1.1 The main objectives of this study are to identify and explore key issues in vocational training and to suggest how these issues could be addressed operationally. Inevitably, resources, time and coverage constraints made choices necessary. New research (except for a small employers' survey conducted by Bank staff during the field mission) could not be initiated and the study was limited to available analytical work and data. World Bank specialists collaborating with Government staff on the design of the study agreed that the most pressing issues to be addressed were: (a) the effectiveness and efficiency of the main training programs being undertaken by NMYC, DECS and by NGOs: (b) the appropriateness of training methods for developing operatives and craftsmen; (c) the appropriateness of approaches to meet the vocational training needs of rural youth, adults, girls and women, and particularly the - role of NGOs; (d) resource allocations and possible ways of tapping new sources of funding; and (e) policy, planning, management and technical support issues and, in particular, the role and effectiveness of NMYC as the lead government agency charged with national responsibility for developing vocational training. The Audience and Scope 1.2 This study should help to meet the needs of three important groups. First is the National Manpower and Youth Council (NMYC) which has a pivotal mandate for government policy making on training and which includes representatives from all major public and private agencies concerned with training and employment, and its Secretariat which also provides support to other agencies and manages 'line" training programs (Attachment II). Second is the DePartment of Education Culture and Sports (DECS) which has been examining issues and looking at ways to strengthen and expand learning through a review of its national education policies and programs, including its role in vocational training. Finally, but not least, are those managing modern sector industry and rural development, which both underpin economic growth and require continuing access to skilled human resources. 1.3 The study is *supply side' oriented and deals only tangentially with employment issues. Employment data are sparse and of poor quality, and there has been no employment study. Yet, it is the employment issue which in every sense drives the supply of all types of labor. The issues, policies,  0S0-22(2) SR044VOC.SEC JP(4):MSG(2)sBWC(2)sDB(2): 01-24-90 -2- strategies and programs for expanding employment are critical to determining training needs. Such a study needs to be done. This study owing to data limitations can come to no firm conclusion on the need for the expansion of the training system for modern sector operatives and craftsmen; but, in spite of hard economic data, draws a justification for expanding basic rural training through public agencies and NGOs on social grounds. 1.4 The scope of the review has been limited to the need for training for operatives and craftsmen for industry and for basic vocational skills training, particularly for unemployed and underemployed youth and adults in the poorest urban areas and, more generally, in the rural hinterland. The focus was based on a consensus among those designing the study that these training levels and areas were most in need of critical and urgent attention. The review has focussed on the agencies providing these levels of training concentrating on the lessons from Filiplno experience and where appropriate suggesting where and how to assist in program expansion and quality improvement. Generally, the analysis. of issues as has been mentioned. has been hampered by inadequate or non-existent data for analysis. 1.5 Consistent with the boundaries set for the study [in the subsectoral field of vocational training], no attempt has been made to review issues relating to some key levels and important fields of vocational training. Higher levels of vocational training have not been examined and the fields of university and specialized tertiary levels of training and retraining remain to be reviewed. A comprehensive examination of the training system cannot ignore these areas, and indications are that such an additional review, with an emphasis which combines science and technology, would be most valuable. 1.6 Horizontally, two key areas of training have not been covered. These are agriculture and related disciplines, and management in general. Both deserve attention and would complement the present review. 1.7 A field mission of about three weeks of World Bank specialists and NMYC Secretariat staff was undertaken in February 1989, with a follow-up shorter visit in June 1989. The Filipino team was led by Lorenzo Buhain, Jr., Director General, NHYC, and included J. Escartin, J. Lacson, V. Guillermo. The World Bank team was led by R. Prosser (World Bank/UNESCO Cooperative Program), C. Sinclair (Economist) R. Castley (Labor Economist), S. Lee (Vocational Training Specialist), and G. Burt (Nonformal Training Specialist). II. BACKGROUND A. Socioeconomic Background 2.1 After many years of mismanagement, compounded by the 1980 international economic slump and oil price rise, the economy of the Philippines is beginning to show signs of reviving as a result of the economic policies pursued by the present Government. The focus of national economic policies is on correcting the balance of payments and on promoting export-led growth to finance imports for further development and to meet heavy international debt obligations. Key economic data for the Philippines during  t50-22(2) SR044VOC.SEC JP(4):MSG(2):BWC(2)iDB(2): 01-24-90 - 3 - 1980-86, compared to that for other major developing countries of the Region are given in Table 2.1 belows Table 2.1: KEY ECONOMIC INDICATORS, BY COUNTRY Growth of Growth of Population Per Capita Agri- Industry Manu- GDP Per Growth GDP culture factu- Capita Rate (1980-86) (1980-86) ring 1986 2 Philippines -1.02 -2.02 -3.52 -1.7? 560 2.5? Indonesia 3.4? -3.02 1.82 7.7Z 490 2.2X Thailand 4.8? 2.9? -5.02 5.2? 810 2.02 Malaysia 4.8? 3.02 -6.02 5.82 1,830 2.72 Korea 8.2Z 5.62 10.22 9.82 2,370 1.42 Sources World Bank Atlas. 2.2 In 1987, the Government decided as part of its medium-term economic adjustment program to focus on revitalization of the industrial/manufacturing sector and to-give priority to promoting export-oriented industries. It also decided on a policy of support to small-scale, rural-based firms to facilitate balanced development and invigorate the rural economy. The Philippines has old, established primary industries (coconut), light manufacturing (footwear, garments, timber) and heavier industry (rubber, chemicals, cement). The manufacturing export sector is dominated by electronics and garments. It is anticipated that the implementation of export-promotion policies coupled with the country's wage levels, which are now more competitive than those of many other countries in the Region, will open up wider export opportunities to labor intensive industries. This, however, must be balanced against dynamic economic growth of the new 'dragons," Malaysia and Thailand and increasingly Indonesia and China. 2.3 In the light of a rapidly changing international economic environ- ment, Philippine int-ustry will have to adjust continuously. A successful response to market changes will depend in part on the skill and flexibility of its workforce. This has important implications for the country's labor training system. A training strategy together with training programs must be designed to permit programs to adjust easily to changing labor market needs. Heavy investment in facilities and equipment must be made in the knowledge that obsolescence occurs speedily with changing industrial technology. Training of trainers must take serious account of retraining needs, and multi- skill training would typically replace the mono-skill type. 2.4 Currently, light manufacturing, export industry is expanding (e.g., garments) and there is an apparent strong demand for well-trained operator- level workers in the largely labor intensive industries and for craftsmen for production, maintenance and supervisory work according to the mission's  050-22(2) SR044VOC.SEC JP(4)2MSG(2)sBWC(2)sDB(2)t 01-24-90 -4- discussions with industrialists. Table 2.2 gives an indication of current employment by economic sector. Table 2.2: EMPLOYMENT BY ECONOMIC SECTOR. 1988 (000'8) No. z Agriculture 9,858 45.8 Mining & Quarrying 168 0.8 Manufacturing and Industry 2,255 10.5 Electricity, Gas & Water 94 0.4 Construction 836 3.9 Wholesale & Retail Trade 2,972 13.8 Transport, Storage and Coinmunication 1,052 4.9 Finance, Insurance E Real Estate 371 1.7 Coumunity, Social & Personal Services 3,884 18.1 Not adequately defined 13 0.1 Total 21,503 100.0 Source: Household Survey, 1988. 2.5 The overall unemployment situation remains serious. Between 1985 and 1988, the number of officially classified unemployed youth and adults grew from 1.5 million to over two million, with rural unemployment growing by 55Z compared to only 19X in urban areas during this period. The rate of unemployment was highest among the younger age groups (202 for those 15-19 years old and 262 for those 20-24 years). Every year some 750,000 new entrants join the labor force. Best estimates suggest there are now some two million unemployed with a further three million youth and adults under- employed. Agriculture remains the largest source of employment, with about 462 of the labor force (declining in recent years as a result of an almost static GDP growth which was only about 0.52 in 1987/8). Manufacturing, with about 102 of the employed labor force and services and marketing with about 32Z of employed labor, have been showing slight employment growth over the past few years. Although manufacturing growth is too small to make a significant impact on the overall employment problem, between 1987 and 1988 it offered some 200,000 new jobs and employed the equivalent of nearly a third of new entrants to the labor force. In the modern manufacturing subsector, export-oriented industries continue to expand, particularly clothing manufacture which is labor intensive (just under 40X of total subsectoral employment), electronics and food processing. 2.6 Due to the lack of a study on employment, the data are non-existant or are very unreliable. However, a recent effort of the NMYC and the Department of Trade and Industry (DTI) to calculate needs for craftsmen and  #50-22(2) SR044VOC.SEC JP(4)ttSG(2)tBWC(2)sDB(2)S 01-24-90 -5- operatives to 1993 is summarized for illustrative purposes in Table 2.3. The table is indicative, reflecting only the needs of larger industries, assuming patterns based on previous years and not taking into account labor emigration which is substantial, averaging half a million contract workers over the past three years. The methodology provides a very weak basis for justifying any expansion and further analytic work would be necessary before any support could be given for an expansionary strategy. The table as developed by government illustrates, however, that the gap between needs and output for specialized craftsmen and general operatives (about 200,000 annually to 1993) is large enough to justify some training capacity expan3ion. This has been foreseen and government proposes that training places will be provided by NMYC in its provincial training centers (PTCs), by Community Training Programs (CTPs) and possibly by She DECs Bureau of Technical and Vocational Educations (BTVE) technical/vo..tion (tech-voc) schools. This report can add nothing to the discussion of expansion, but can, in later secelons, predicated on government's intention to expand, indicate which of the current delivery systems are most cost-effective.  850-22(2) SR044VOC.SEC JP(4)sMSG(2):BWC(2)%DB(2)t 01-24-90 - 6 - Table 2.3: DEMAND AND SUPPLY CAPACITY OF CRAFTSMEN AND OPERATIVES Occupational Number Z Annual Rate Projected Annual Projected Present output Level la Employed of Growth Rate of Growth annual noe. capacity 1987 1980-87 1988-93 needed (NMYC & BTVE) (incremental) (Annual) Craftsmen (General) 480,000 4.6Z 6.2Z 33,000 30,000 lb oraftsmen (Specialized) 1.610,000 3.4Z 9.5S 182,000 47,000 /b oeratives (General) 950,000 4.11 5.12 50,000 10,000 /c aperatives (Specialized) 730,000 4.0 6.5Z 50,000 on-the-job Source: Industry Development Plan, 1988, DTI. ra Definitions: Craftsmen (general) - machine tool operators, fitters, auto mechanics, plumbers, electricians, welders. Craftsmen (specialized) - tanners, tailors, footwear producers, furniture makers, jewelers, printers, potters. Operatives (general) - plant/machine operators, e.g., trailer drivers, heavy equipment operators. Operatives (specialized) - miners, quarrymen, chemical workers, spin- ners, weavers, food processors. lb Shortfall expected to be met from new provincial training centers. Ic Shortfall expected to be met from CTPs and possibly tech/voc schools. 2.7 The broad development strategy provided in the National Development Plan 1987-92 properly emphasizes the need to address the rural employment issue through a special effort to strengthen rural enterprise programs and *non-formalm out-reach 1/ training to support income earning and livelihood 1i 'Non-formal* is a very general term and should not be interpreted as signifying a group of homogeneous educational efforts (either related to clientele, syllabi, methods or institutions). Its use dates from the early 1970s when, for analytic purposes and out of a realization that the traditional formal school appeared inadequate to meet the needs of the Third World, other educational modes conveniently termed nonformal (if organized) or informal (if  J50-22(2) SR044VOC.SEC JP(4):MSG(2)tBWC(2)sDB(2): 01-24-90 - 7 - skills needs. The Plan, however, places undue emphasis on training as a cure for employment. Not uncommonly, training and particularly vocational training are seen as a way of creating jobs, alleviating poverty and providing self- employment opportunities. However, ways of reducing unemployment are part of the economic issue, and training is but one of a variety of responses needed to enhance modernization and development once the rural (or urban) economy begins to grow. Nonetheless, the ease with which workers trained by DTI and NHYC tends to confirm the opinion of industry and of the NGOs working in rural areas that there are significant and growing skills gaps to be met at lower and middle worker levels. B. Current Training Approaches and Programs 2.8 This section sketches the organization, programs and output of the main agencies that provide vocational training. An important characteristic of the training system that can be flagged at the outset is the comparatively low level involvement of private industry in training and conversely the high profile role of the public sector. The conventional explanation for the lack of industrial involvement by both industrialists and public sector training managers is the 'weakness' of industry and its small-scale nature to enable it to bear the financing and management of training. There are trends toward cost-sharing programs between the public and private sectors and these are described later. The general issue is also taken up in a later part of the review. It is one of the basic tenets that the national training strategy should provide that ultimately, and sooner rather than later, training costs to the extent possible, should be borne by the immediate beneficiaries. 2.9 In the public sector, the NMYC is the main agency charged with managing national vocational training, supporting its quality and development, and organizing training programs. The NMYC training program is the largest of all programs with an annual output of more than double all others together. DECS is another important provider of training through its Bureau of Technical and Vocational Education (BTVE) and Bureau of Non-formal Education (BNFE). The BNFE focusses on basic education and training from literacy to simple livelihood skills. In addition, DTI has a small program of basic craft training focussing on folk handicrafts, while the Department of Social Welfare (DSID) focusses on the most deprived slum and poorest rural areas and provides non-formal basic education integrated into programs for basic iivelihood skills development. In the private sector, the NGOs provide important, and usually free education and training programs throughout the country typically of the non-formal basic type. Private, fee paying, and 'for profit' training is undertaken by small technical schools and private universities. In- unorganized) were seen as necessary to help bear the educational burden. In the case of nonformal education. there was a particular interest in programs that were thought to be less costly and able to replace the school. In this chapter, the definition first elaborated in the Coombs study of 1973 is used: 'any organized education activity outside the established formal system--whether operating se?arately or as an important part of some broader activity--th.,t is intended to serve identifiable learning clienteles and learning objectives" (New Paths to Learning, UNICEF/ICED, 1973).  *50-22(2) SR044VOC.SEC JP(4)sMSG(2)tBWC(2):DB(2): 01-24- - a - service programs provided directly by private industry are rare and typically limited to the multi-national companies. The current training capacity of the major providers is indicated in Table 2.4t Table 2.4' ESTIMATED ENROLLMENTS AND OUTPUT OF VOCATIONAL TRAINING INSTITUTIONS, 1986 AND 1987 1986 1987 Output Output Enrollment per Annum Enrollment per Annum Mac UNTCs n.a. 10,300 10,300 CTCs n.a. 1,800 - 30,000 CTP (Outreach) n.a. 32,000 j PTCs n.a. 6,000 6,000 TCS 20,600 20,600 22,100 22,000 lBs n.a. 2,900 2,900 Eatrepreneur Program - (491) (491) Total 75,100 74,209 ENE (DECs) Post-Sec. Tech. /a Voc. Schools 30,200 10,000 35,000 12.000 PrEvate Post-Sec. Tech. /a 48,000 20,000 50,000 21,000 Schools GRAND TOTAL n.a. n.a. 160,000 107,000 ta About 50Z of tech/voc school places are in two-year courses. It is assumed that all places are for pure tech/voc courses, but this may not be accurate as graduates do not necessarily directly enter the labor market but may continue with tertiary training or education. Sburce: Mission estimates based on NMYC and DECS data.  #50-22(2) SRO44VOC.SEC JP(4)tMSG(2)tBWC(2)tDB(2): 01-24-90 -9- National Manpower and Youth Council 2.10 Mandate and Organization. In 1966, the Government created a Manpower Development Council to integrate various skills training activities in the Philippines under one body. From this beginning, the NMYC developed, with important statutory powers consolidated in an Act of Congress in 1969. The powers and functions of the Council were further enhanced by the promulgation of a Labor Code in 1974. The prime purposes of the Council under the Act and Labor Code are to: (a) recommend on the development of national training policies, strategies and programs to meet manpower needs; (b) provide 'staff" support to agencies executing training programs through technical advice and assistance to improve training planning, management, quality, efficiency and relevance and initiate research and development, and (c) undertake training programs. 2.11 The NMXC is headed by a Council consisting of senior representatives from all training bodies in the country. These include both government bodies dealing with human resources and private sector representatives from labor, management and industry, and youth welfare organizations. The Council is currently chaired by the Secretary of Labor and Employment (DOLE), with the Secretary of DECS as Vice Chairman. Other government officials on the Council include: the Secretaries of Trade and Industry, Food and Agriculture, Environment and Natural Resources, Social Welfare and Development, Secretary of Science and Technology, Local Government, the Director General of the Nationa!. Economic and Development Authority (NEDA) and the Chairman of the Civil Service Commission. From the private sector are two representatives from labor, two from management and industry, one for youth welfare and one for family organizations (See Attachment 2A). The Council membership was established some years ago and may not now be entirely appropriate. There is a case for reviewing the membership and increasing the representation from industry and NGOs. At present, the Council has four major standing committees covering major training areas: industry, agriculture, services and non- formal education. Each has functions for policy formulation and planning. These are shown in Organigram One at the end of the report. 2.12 The Council is provided with a full-time Secretariat headed by a Director General assisted by a Deputy Director General. The organization of the Secretariat is illustrated In Organigram Two at the end of the report. The Secretariat has developed a strong public image and 'everyday" reference to NMYC usually indicates the Secretariat rather than the Council. Indeed, since its inception, the Council per se appears to have been very much a tool of its Secretariat. That, combined with the NHYC's strong "line" training activities has at times led to its appearing as a self-serving organization, militating against its smooth functioning in the role of a coordinator. 2.13 The NMYC organization is overly complex and not entirely in harmony with its functions. The Deputy Director General, was recently given responsibility for the line functions. Four Executive Directors head key Departmentst the Manpower Planning Office (MPO), the Industry Manpower Office (IMO), the National Institute for Skills Development (NISD), and the National Skills Training Center (NSTC). The functions of these offices are summarized below and discussed further in Attachment 2.  150-22(2) SR044VOC.SEC JP(4)3MSG(2):BWC(2)iDB(2)t 01-24-90 - 10 - 2.14 The MPO has both line and staff functions and embraces three divisions; Planning, Rural Manpower Development, and Evaluation and Research. The MPO is intended to provide policy direction to the Council, including the mapping out of strategies for the preparation, utilization and conservation of the country's human resources. It should also provide consultative technical and advisory services on planning to the regional offices of NKYC, but to date has had limited capacity do so. The MPO is currently, inadequately staffed and managed. Though attention is being paid to its strengthening, there is far to go. 2.15 The NISD consists of divisions for Skills Standards Development, Training Technology, Trainers' Development, and Vocational Guidance. It is responsible to provide policy recommendations on trainers' training, skill standards development and certification, curriculum/training materials development, vocational guidance, and management and development of staff training. The NISD is one of the strongest of NMYC's offices, and its work is reflected in the comparative strength of the NMXC training programs. It is not clear that it impacts strongly on other agencies. 2.16 The 1M0 provides line support through an Industry Services Division and a Training Incentives Division. It is expected to recommend policy directions and oversee the implementation of industry-related manpower activi- ties. Primarily, it seeks to maximize private sector participation in man- power development and conducts research on industry manpower trends. 2.17 The NSTC 2/ has divisions for training, new skills development and operations and includes what are essentially the line functions of a regional training center. It is intended to recommend policies on the establishment, administration and management of national manpower sktlls training programs and projects, including those undertaken through foreign financial and technical assistance. 2.18 At the regional level, NMYC has 14 regional offices (RMDOs), each headed by a Regional Director who reports to the Director General. The Regionai Directors are virtually autonomous and responsible to plan and implement manpower development plans for their respective regions. They conduct training programs at the Regional Manpower Training Center (RMTCs) independently or in collaboration with local government, other national government agencies, private companies and NGOs. At the provincial level, six experimental provincial manpower training centers (PTCs) are being established together with 75 local community training centers (CTCs). The 16 RMTCs run courses of six months or less for operators and craftsmen in traditional skills such as mechanics, construction, and electronics, and are housed in well-equipped permanent structures. Three RMTCs have important functions in trainer training and trainer upgrading. The experimental PTCs run similar courses, but with an emphasis on addressing local industry needs. The CTCs are established in conjunction with implementation of the Community Training 2/ The national training center has a similar training program but also offers advanced skills upgrading and experimental training in new trades.  J50-22(2) SR044VOC.SEC JP(4)sMSG(2)tBWC(2):DB(2)s 01-24-90 Program (CTP), a particularly important new local, grass-roots training initiative which is described in paras. 2.21-2.30. 2.19 Current NMYC Programs and Initiatives. In 1986, after the political revolution, new priorities were established by the Government to improve the economy, alleviate poverty, and generate more employment. In particular, government policies measures are being adopted to promote the growth of more small-scale, labor-intensive businesses such as those in the garment industry with a concentration on the rural areas as opposed to investments in urban- oriented, capital-intensive, and large-scale industries. These policies are providing the framework for NMYC programs. 2.20 The NHYC, transferred in 1986 from the President's Office to the Department of Labor, is benefitting from recent efforts to improve its effectiveness and efficiency. Under a new Director General, the Council's awareness of training issues is being heightened, the frequency of meetings has increased from one to at least four a year, and a more significant business agenda is being tabled and shared with Council members. To support the policy focus on industrial expansion and productivity improvement, the NMYC has oriented training efforts toward skills upgrading and in-plant training. Training-within-industry has been greatly enhanced through an expanded training contract scheme which grants subsidies to accredited - workers' development programs. Livelihood skills training has been expanded to rural workers through the development of the CTP and establishment of community training centers. NKYC is now implementing a five-year plan (1988- 1992) which emphasizes industrial training and livelihood skills and values education.3/ In addition, important new thrusts include: (a) introduction of entrepreneurship training; (b) improving quality of RTC training through transferring budgetary support from the NKYC central office to the regions; (c) increasing consultation with industry; and (d) intensifying dialogue with other training agencies. 2.21 The Community Training Program. NHYC developed the concept of the CTP to complement and build on the work of RMTCs and PTCs by increasing the access of rural youth and adults to basic vocational training at village level. Although CTP training is being provided directly by NMYC initially, the longer-term aim is to encourage local village and local area organizations to build up their own training capabilities and thus help meet local training needs more effectively. Evidence in areas where the CTP has been established indicates that the approach is developing successfully; in some cases, physical centers have been established by local communities, but this is not an essential feature of the program. 31 'Values Education' is a government policy officially sanctioned in DECS Memorandum No. 99, s. 1986. Values development has been integrated into non-formal education programs/projects to promote desirable values such as love of country, faith in God, honesty, freedom, self-worth/self- esteem, social justice, conservation, responsibli parenthood, loyalty, unity, hope and creativity.  *50-22(2) SR044VOC.SSC JP(4)sMSG(2):BWC(2)sDB(2)s 01-24-90 - 12 - 2.22 The CTP is intended to provide a flexible response to rural, local training needs. In particular, the program is intended to be mobile, with no permanent physical structure (buildings are provided by other organizations and are mainly used for other purposes). Training courses do not need to run continuously, but can be part-time and once the training needs of a locality have been satisfied, courses cease. 2.23 The program attempts to fill gaps that exist in grass-roots train- ing, as there are thousands of communities lacking these opportunities (some 1,500 municipalities alone, each composed of many barangays and the smaller sitios 4/ most of which have no training effort, the present NMYC target of establishing 75 CTP operational centers must be regarded as only an initial token. 2.24 The program attempts to maximize investment in training by ensuring that existing companies in the local community are able to absorb graduates; this goal is facilitated locally by Provincial Manpower Development Officers (PMDOs), based in the Regional offices, who estimate needs and liaise with local employees. However, much of the training provided is equally relevant for self-employment, and some training courses have no application for existing companies (for example, machine sewing in an area where the only employer is a heavy industry) but are important for livelihood improvement. 2.25 NMYC's strategy in setting up the CTP is that it should have an enabling* role, but would have no long-term management commitment. To this end, it will establish a CTP only if there is a local commitment to provide funding and other support (a fundamental requirement, for instance, is that premises are supplied by a local agency). In order to promote CTPs and at the same time minimize NMYC's long-term commitment, funding from NMYC is on a declining basis, as followss Year of Operation NMYC Funding Local Funding (for each CTP) 1st 802 202 2nd 602 402 3rd 251 752 Z.Z6 Usually, local funding comes from the municipality or other local government authority; no po'icy has yet been decided about funding after the third year, but NMYC expects to continue the contributions as for the third year. NMYC Guidelines for course costs are P 12,000 (US$571) for livelihood courses and about P 16,500 (US$785) for basic industrial skills courses. 2.27 NMYC's operational strategy is explicit about the need for CTCs to be set up with appropriate and adequate tools and equipment before training courses are promoted. Inability to supply these inputs has severely limited 4/ Village.  t50-22(2) SR044VOC.SEC JP(4):MSG(2)3BWC(2)tDB(Z)t 01-24-90 - 13 - the type of courses offered as well as their number and frequency. With commendable local flexibility, some equipment has been rented to allow courses to proceed, but typically with a consequent strain on an already limited budget. Delays also occur in the delivery of training materials due to NMYC's cumbersome system of ordering, purchasing, and accounting; some courses had been in progress for up to three weeks before training materials have been delivered. A further inefficiency arises because materials such as bamboo and rattan are usually purchased by the Regional Office and transported to the CTC, although prices may be lower at the local level, causing undue delays and expense. Such problems are more severe in the island provinces due to their particular transport difficulties and because most do not have a Provincial Manpower Development Officer who might expedite supply. 2.28 The delays in funding and the provision of equipment and materials not only delay training but also decrease staff enthusiasm for the Program. The personnel on whom the CTP system relies for local course provision--both administrators and trainers--become frustrated and lose the motivation necessary to operate such a flexible program. This applies especially to field personnel, for whom the CTP represents an additional element in their workload and who consequently view the CTPs as taking up a disproportionate amount of time. 2.29 Buildings for CTP activities are modest and limited for space (this is beyond the control of NKYC, as the buildings are provided locally, mainly by municipal governments). The average CTC physically accommodates only two classes of 25 trainees each at a time. This implies & maximum capacity at any one time nationally of 3,750 places (75 CTCs x 50 places). 2.30 The CTP accounted for nearly three quarters of NMYC's total training output in 1987. New training programs have been developed for emerging skills and for the special training needs of specific industry sectors such as garments. In spite of the difficulties noted here and known to the NMYC, the CT?P is proving a very successful model. 2.31 Special NMYC Programs. Besides the 'center, based training programs, NMYC organizes and administers important training support programs which link directly with industry. These are the Training Contract Scheme (TCS) and the Industry Boards (IB). 2.32 Under the training contract scheme financial incentives are provided to industry to foster training. NMYC reimburses a firm undertaking its own training or a training institution undertaking training for a specific firm, a proportion of tuition fees, allowances and stipends for each trainee provided the trainee passes the relevant skill test. The proportion of NMYC financial support began at 702 of the per trainee training cost and has now declined to 50?, reflecting the willingness of industry to bear a greater proportion of the cost. In time, the proportion provided by NMYC may be further decreased. The TCS produces just over 20,000 (17?) of NMYC trained personnel (1987). Details of TCS enrollment growth are given in Attachment 2D.  - 14 - 2.33 The Industry Board Scheme 5/ was designed to assist in manpower development schemes and related activities such as trade and skill standards. Once fully operational, an Industry Board is expected to assume tile relevant training activities of NHYC and ensure an adequate supply of trained workers at all levels of employment within its own industry grouping. lBs are also involved with trade standards and testing and placement assistance. The I8 scheme, however, has never really taken root and caters annually for only some 3,000 trainees (1987). A key problem is the national approach taken by NHYC in administering the scheme, which does not take sufficiently into account the district-specific nature of industrial location and labor needs. The IBs have also become dependent on NMYC for staff suppn-t and funding for training. The best IB training program to date is that for garment manufacturing. This program is decentralized, thus overcoming the general IB weakness of insensitivity to local manpower needs. The program is run in association with the Department of Trade and Industry and involves the training of some 13,000 skilled sewers and machine operators, with about half being trained in NMYC RTCs. There is also a special trainers' training program. Garment manufacturing is a particularly important industry in the Philippines, with export receipts having grown from P 556 million (1983) to P 1.3 billion (1987). It provides employment for some 400,000 workers through around 30,000 small subcontracting firms, many in rural locations. In spite of the success of the garment industry IX, further study is needed of the potential in the Philippines for strengthening the IB system and of the system's overall viability as a vocational training instrument. Department of Education, Culture and Sports 2.34 The DECS now produces about 122 of all vocational graduates for the operative and craftsmen market segment, but has the oldest government program for vocational training. This is implemented through a typical Bureau of Technical and Vocational Education (BTVE) rooted in a, now defunct, 4-grade secondary level, technical school program paralleling the secondary general program and producing graduates for university science and engineering post- secondary and tertiary level courses. Drop-outs and some graduates from the courses sought direct entry to the labor market at artisan level. In 1983, following a major secondary level curriculum reform, the four year secondary technical course was phased out and was replaced by more post-secondary, one- and two-year courses in trade skills for operatives and craftsmen (mechanical, civil, electrical, engineering, construction, refrigeration technology) w1th a general education content. Some graduates continue to higher studies, others enter the labor market. At the same time, the general secondary curriculum became 'comprehensive' and included pre-vocational skills training as part of the new general education program. In 1986; a new post-secondary, three-year course for technician training was introduced into 21 tech-voc schools converted and refurbished as Technical Education Institutes (TEls). 2.35 Last year (1988) a survey was taken of all tech-voc schools with a view to assess their capability of providing quality courses. Of 330, a third S/ Industries include automobile production, transportation, power, construction, hotels, and garment manufacturing.  *50-22(2) SRO44VOC.SEC JP4)M:MSG(2) :BWC(2):DB(2): 01-24-90 - 15 - were judged inadequate and were given a year to meet BTVE standards; 220 were assessed as capable of providing quality one- and two-year courses, but of these, not more than 40 had the potential of providing three-year courses. All schools, however, remain poorly equipped and staffed. A ratio of over 30 students to each instructor has been the norm, although in 1989, due to a reduction in the number of schools and the transfer of technical teachers, the ratio has improved to 20X1. According to industry employers the schools do not serve the labor market adequately though total enrollment reaches some 30,000 in the one-and two-year courses. Graduates from the schools, indeed, find difficulty in getting employment and frequently take further training at NMYC centers to facilitate employment. There is also an overlap in training provided by NMYC and BTVE. 2.36 Some of these deficiencies would be addressed under a proposed policy to change the DECS tech-voc schools program gradually, upgrading the best institutions into TEIs and to convert the remainder into general secondary schools or focal technical schools to service the pre-vocational element in nearby general secondary schools under the new vocationalizing curriculum. Some schools could, where appropriate in location and design, become PTCs, and there is scope for a joint training arrangement, with NMYC staff (increased as necessary) to undertake the practical training and BTVE the theoretical, capitalizing on the strengths of each system. The development of Technical Education Institutes and four regional centers for staff development has been supported by the Asian Development Bank with promise of further support from Australian aid. The new TEIs will produce their first graduates this year, whose employment appears assured in view of employer interest already expressed. 2.37 DECS also has responsibility for coordinating and implementing basic vocational training through its Bureau of Non-formal Education (BNFE) which expects to train some 480,000 (1987) out-of-school youths and adults in tailor-made, grass-roots programs of lengths varying from a few days to a few weeks. These are based in local buildings, including DECS schools, as available on an out-reach basis. The programs typically include literacy, family life, and health and have a livelihood skills focus with a potential for self-employment. Courses include garment making, auto maintenance and electronics (see Chapter 3 and Chapter 5 of the Philippines Education Sector Study, December 1988) and, as they generally respond to a local felt, need are both relevant and usually successful. About three quarters of the clientele of these courses are women and girls. While there is a potential overlap between these courses and the CTP and DSWD programs, cooperation among the agencies has avoided this problem thus far. 2.38 The Department of Social Welfare (DSWD) provides basic livelihood skills training in the poorest areas, typically through short courses in borrowed facilities and in cooperation with NGOs. DSWD claims to reach over 250,000 youths and adults annually. The programs are locally initiated and difficult to assess, though anecdotal evidence suggests that they work well in response to the local needs of the most deprived. The programs are run by Self-employment Assistance Workers employed by DSWD.  J50-22(2) SR044VOC.SEC JP(4)tHSG(2)tBWC(2)sDB(2)s 01-24-90 - 16 _ Other Government Programs 2.39 The DOLE has responsibility for apprenticeshin development which, however. has had a very checkered history. In the early 1980s this became a source of low-cost labor for employers rather than, as intended, a skills development program for young workers. While the DOLE apprenticeship program was therefore allowed to run down, over the past few months, it has been given a fresh impetus with the issue of a new government order describing the general policy and guidelines for the implementation of a new apprenticeship program. It remains to be seen how well the new structure will be implemented, as detailed planning for its implementation is in its infancy and as yet DOLE has neither staffing nor resources for program development. Private Schools for Profit 2.40 The BTVE also has nominal oversight for a variety of private. profit-making, technical schools and colleges. These cover a multitude of institutions that vary from small, typing schools to a few well-established technical schools, typically run on a fee-paying, cost-covering basis by private universities. They also include private secondary general schools with vocational courses. BTVE estimates that overall enrollment in these schools totals some 50,000 students annually,but this figure should be treated with great caution. There is no breakdown into type of vocational graduates being produced. BTVE is able to exert no quality control over the schools. and no data are available on the number of institutions, length of courses, number of places for each specialty or training level. As might be expected, the private schools concentrate on the less capital intensive training (typing, etc.). Private schools are typically very poorly equipped and their graduates are of poor quality. Graduates of the private universities that support technical schools which are typically of a high standard, are primarily aspirants for university entrance after a usual post-secondary, two- year training course. Non-Governmental Organizations 2.41 NGOs are important organizers, providers and financiers of grass- roots, basic rural vocational skills training. typically as part of a program of family life or livelihood education. The Philippines has nourished a large number of national NGOs working at the grass roots and small local voluntary organizations that serve the needs of the local milieu. There is, however, no umbrella organization--or organizations--and it is not possible to monitor or to determine the volume of training--or other services being provided. An exception is the Churches, but even here centralized information is limited. 2.42 It will be for the NGOs to decide whether and, if so, how to create a few coordinating NGO bodies. Such bodies, however, could assist in channelling external aid to the NGOs aid. From field visits to a few NGOs, the high quality of training was sufficiently well evidenced to justify the recommendation that some kind of mechanism should be instituted so that the public sector can assist NGOs with their training work or vice versa without impinging on the independence of the NGOs or creating a feeling of dependency.  150-22(2) SR044VOC.SEC JP(4)tMSG(2):BWC(2):DB(2)t 01-24-90 - 17 - 2.43 To illustrate the scope and high quality of training by NGOs, two examples can be cited. The first is an interesting, if not typical, large successful NGO that works with other NG0s and governmentt the Philippines Business for Social Progress (PBSP). The second, is a smaller, more typical local NGO, the Camarin Association. 2.44 PBSP is a national NGO, providing, inter alia, training and training funding throughout the Philippines. It was set up in 1970 and is now funded by some 120 private sector companies, each of which is committed to setting aside 1 of each year's net profits before taxes for social development. About 202 of this is given to PBSP. PSBP has annual income and expenditure or around P 57 million (US$2.7 million). However, only P 1.65 million (US$78,000) are used for operating expenses; the remainder goes to programs. It is thus a very efficient provider of services to the 485 local development projects it supports. 2.45 Besides funding local projects, the PBSP ensures the adequacy of training. It provides some training directly, using its own staff for training in technical, vocational and management skills. More importantly, it uses the expertise of its on staff as a multiplier, by running extensive training of trainers' courses for other NGOs and for representatives from local communities who will be trainers within these communities. Some PBSP training is funded by a grant from NMYC. In addition, PBSP sometimes uses other local NGOs to deliver some of its training. For example, in Baquio City, the Institute for Small Scale Industries Foundation Inc. (the extension department of St. Louis University) provides training on behalf of PBSP. 2.46 PBSP is also developing a network of support by encouraging its sponsoring companies to become involved in local projects by providing training, using the expertise of the staff of these companies; currently 28 local projects are benefiting from this Hembership Involvement Program. 2.47 PBSP cooperates with government departments and overseas aid agencies, who often use this NGO and others as efficient vehicles for ac- curately targeting their funding. 2.48 The Camarin Livelihood and Community Development Association (CLACDA) is a small, locally-based NG0, providing local responses to local training needs. Camarin Barrio is a depressed semi-rural community with a total land area of 150 hectares, in which some 3,250 families reside, with an average household size of six. The majority of the heads of households are seasonally employed as factory and construc.tion laborers, earning a monthly income of P 500 to P 1,000 (US$25 to US$50). 2.49 CLACDA began after the formation of the Camarin Livelihood and Community Development Program, an initiative of local people, with the help of the Sub-Parish Council and Our Lady of Lourdes Church. (Interestingly, training and other assistance was requested and providers from PBSP.) The program began by establishing two units, one is the Basic Commodity Center (BCC) which purchases commodities wholesale and distributes them to the small stores within Camarin, and the other is a Credit Assistance Group (CAG) which evaluates, administers, and monitors loans to individuals and collectives. These have now been incorporated as the Camarin Livelihood and Community  950-22(2) SR044VOC.SEC JP(4):MSG(2):BWC(2):DB(2): 01-24-90 - 18 - Development Association (CLACDA Inc.) and is registered with the Security and Exchange Commission (SEC). Besides the management of BCC and CAG, CLACDA has responsibility for overall technical and business training within the community and has set up four area-based community groups to undertake promotional work and the screening and monitoring of loan recipients. 2.50 Though the beneficiaries of the training and assistance program are men and women in almost equal numbers, the management committees are overwhelmingly women. The cooperative and collective nature of community- based initiatives encourages women to participate more fully than in traditional hierarchical structures (in CLACDA, the company officers, such as Secretary and Chairman, are women), while the local basis allows them to combine family duties with coumunity service. 2.51 The main CLACDA training program started in 1986 as part of the Camarin Livelihood and Community Development Program. The Program is now largely self-sustaining and self-managing, providing technical and business training for individual entrepreneurs, coupled with small but effective grants, and training in organizing skills for the community. The training program includes: small business management, basic community organizing, personal effectiveness, food processing, photography, leadership skills, personal effectiveness, group decision making, an integrated livelihood program, practical swine raising and value formation. 2.52 Beside the organized courses, trainers have constant (if part-time) contact with beneficiaries and the community organization, giving guidance and advice in the form of continuous development training, Much of this training has been given by employees of a PBSP-sponsoring company. 2.53 Sycip, Gorres, Velayo & Co. (SGV) is one of the PBSP's funding sponsors. A member of the Arthur Young McLeland Moores international accountancy group, it has been donating staff time to the Camarin project since its inception; currently, two financial and management specialists spend 10? of their working time and some free time training the CLACDA members. SGV also employs a Development Worker, funded jointly by SGB and PBSP, who works full-time on the Camarin Project. The professionals from SGV originally found difficulty in communicating effectively with the CLACDA members as they come from different backgrounds and have radically different perspectives and knowledge levels. PBSP provided training for the SGV professionals in the appropriate approach to this type of training, which has enabled them to be more effective as technical trainers. The CLACDA operation is illustrated in Organigram 3 at the end of the report. 2.54 So far, the CLACDA training project has created 80 jobs in various enterprises including: Vending, Pigery, Poultry, Furniture Making, Iron Works, Sari-Sari Store, Rug Making, Watch Repair, Food Processing, Motor Repair Shop, Herbal and Tire Recycling. 2.55 The budget for the project in the current year is P 83,500 (US$3,900); this amount is sufficient for the present capabilities of CLACDA and funding has not yet been a limiting factor in the rate of development. However, Camarin has been fortunate in being selected for assistance (albeit on its own initiative) and other communities may find more difficulty in  #50-22(2) SR044VOC.SEC JP(4):MSG(2):BWC(2):DB(2)t 01-24-90 - 19-- securing funding. CLACDA itself will require increased funding if its activities are to expand, and its training in community organizing skills will be tested by its need to secure finance once the PBSP/SGV support ends. It is seen as essential by PBSP/SGV and CLACDA that funding assistance be made available to beneficiaries in order to maximize the investment in their training. Those in the training courses are expected to generate at least P 50 (US$2.5) additional income per month from a P 1,000 (US$47) loan; loans range for P 1,000 (US$47) to P 3,000 (US$140). The effectiveness of the training is demonstrated by an 80Z success rate in repayment of loans. This must be remarkable in such a poor community. Training for Women 2.56 All training programs are open to women and girls. However, unless training is held at times when women do not have domestic and family duties, or unless facilities are provided for child-care, women are effectively prevented from taking courses even though the enrollment policy may be ostensibly open. In the rural areas, women undertake not only housework and childrearing, but often also the work of food production or other income- generating activities; though values training is attempting to change the roles of women and men, it will be a long time before this burden is removed. NGOs are active in women's training but data are difficilt to gather. The CLACDA example described earlier is a good example of typical NGO assistance in training. 2.57 The BNFE makes a special effort in their livelihood skills program to attract women and has successfully organized traditional courses especially for them. Training subjects are usually *traditional," that is industrial/ technical subjects are oriented towards men and domestic-type subjects (e.g., food preserving) are targeted, even if tacitly, toward women; this division mirrors the employment position, but unless women receive, or are encouraged to receive, training outside their normal subjects, the position will not change. 2.58 The BN?E Livelihood Skills Development Program has a large enough number of trainees (484,317 in 1987) to measure the effectiveness of their training for women. The enrollment and graduation ratios, and the drop-out and failure rates for men and women are shown below:  *50-22(2) SR044VOC.SEC JP(4)tMSG(2):BWC(2)zDB(2): 01-24-90 - - 20 - Table 2.5: BNFE LIVELIHOOD SKILLS TRAINING COURSES, 1987 Enrollment Ratios OSY /a Adult Male 39.82 35.4Z Female 60.2Z 64.62 Graduation Ratios OSY A it Male 44.6Z 39.7? Female 55.42 60.3Z Dropout/Failure Ratios OSY Adult Male 19.42 24.42 Female 33.82 37.12 /a OSY - Out of school youth. 2.59 Women, whether young people or adults, enroll and graduate in sig- nificantly greater numbers than men. More interestingly in relation to the effectiveness of the training for women, they have a much higher dropout/ failure rate than men (over 502 higher). 2.60 The NMYC has also been active in promoting training for women. NMYC in 1980 launched an experimental project in training for women in non- traditional skills. Girls and women were trained in male-dominated courses such as welding, refrigeration and air-conditioning, building, wiring, electricity, home appliance servicing and others. An evaluation of the experiment showed that women willingly join industrial trades because of pressing economic needs. Employers are equally willing to absorb women workers into non-traditional occupations because of their high performance level, reliability and dedication. Manpower development officials including planners and instructors have also reacted positively to the NMYC experiment. To date, a few government agencies have tried to redirect some of their training programs for women into areas that are traditionally considered for males only. 2.61 Building on the NMYC experiment, a three-year project launched in 1988 is being implemented with support from the ILO and the Netherlands Aid agency. The project is designed to train more females, side-by-side with males. The areas of training include: electrician services, automotive trades, welding, furniture and cabinet making, refrigeration and air-con- ditioning, repair and maintenance of office equipment, plumbing, masonry and carpentry. Training is also given in entrepreneurship and self-employment. The choice of training areas is based on periodic studies conducted by NYMC's Regional Manpower Training Centers to determine area skills requirements and training priorities. Training will be conducted in RMTCs, PTCs and CT-Is, and will also be industry-based.  #50-22(2) SR044VOC.SEC JP(4)tMSG(2):BWC(2)tDB(2)2 01-24-90 - 21 - 2.62 To help the trainees' internalize their emergent roles in the world of men's work, one of the project components is the training of women trainers. These trained women trainers will instruct both males and females. Other actions being taken to change occupational attitudes are information and motivational campaigns, career guidance and counselling, and development of necessary materials for these activities. 2.63 The project aims to mobilize multisectoral support to help ensure the achievement of its objectives. The organizations include both government and NGOs such as the National Coumission of Women (NCW), DECs, DSWD, the Trade Union Congress of the Philippines (TUCP), the Employers' Confederation of the Philippines, and the Public Information Agency. 2.64 In addition to this project, the CTP is being developed by NMYC for women's training. The enrollment at CTP courses (for example, an electronics course in Antipolo) showed a roughly equal balance between men and women, but the test will be whether the women trainees obtain a relevant job at the end of their training. NKYC has built in a mechanism to its training programs to trace the subsequent career of its trainees, but as yet no data are available. III. CRITICAL ISSUES AND STRATEGIES 3.1 The review of training for operatives and craftsmen indicated issues clustered around the following five areas: (a) how to meet most effectively industrial sector manpower requirements and the need for training in rural areas; (b) the relevance and quality of industrial and rural training; (c) efficiency and financial issues; (d) planning issues; and (e) policy and institutional issues. A. Meeting Manpower Needs 3.2 This report cannot recommend an expansion of the training of operatives and craftsmen for the modern industrial sector as no recent national employment survey or complete subsectoral employment needs assessments have been made. Although a small industry survey undertaken by the mission and the ease with which NHYC trainees gain employment are indicative of a case for increasing the supply of operatives and craftsmen this evidence is insufficient of itself. A recent government estimate shows an annual net shortfall of about 265,000 workers (Table 2.3) and on this basis government may encourage expansion. If this is the case, the issue is by which institutions. The overall output of more formalized training by the public sector to meet industrial needs at-operative and craftsmen levels ranges from about 60,000 to 80,000 a year (assuming about 80Z of all graduates from the BTVE technical/vocational and private schools go on to higher or other training institutions). This compares with the 750,000 new entrants to the labor force. 3.3 Small-scale industry is currently in no position to undertake its own training. There are also institutional, economic and social reasons why, in the short to medium term, any national training strategy must be built on the public sector. Among the key economic reasons is the general inability of industry to bear the cost of training when the industries are small and still  , .(2) . .(4) (2) :_ (Z) - 22 - at an Oinfant" stage. Institutionally, industry has not been persuaded or assisted adequately to build up its own training capability and is therefore ill-equipped to do so. Socially, there remains a gap of about at least two years between the age when children complete four-year secondary school courses and the legal working age. While this is being partially filled by state organized training, there remains a need to assist the poorest urban and rural youth and adults through training and follow-up assistance to self- employment and to respond to the serious claim of women to state training and job placement assistance where traditional attitudes mitigate against women's employment. There is no doubt, however, that any training strategy should seek as quickly as possible, though not at the expense of quality or social deprivation, to shift the core burden of training from the public to the private sector through an incentive system. A contribution to such a system are the NMYC efforts to build up training capacity in the private sector, including the tax-incentive scheme, training contract scheme and the revitalization of DOLE of the apprenticeship support scheme. It is also necessary to remove disincentives. For instance, after six months of full- time employment, employers are obligated to provide 'social security" benefits to employees which has led to the malpractice of dismissing workers within the six month period to avoid the additional costs. There is a strong case for moving further and more quickly in developing these and other measures. 3.4 Programs Capable of Expansion. The evidence is strong that the NMYC line programs offer the most effective vehicles for expanding industrial training development particularly through the PTC, CTP and out-reach programs (Section B). 3.5 The first priority, however, is to improve the existing NMYC PTC programs through a stronger provincial network of training centers, together with links with local industry and based on meeting identified local manpower training demand. PTCs provide a more local and *closer to industry" focus for strengthening IB developments and the TCS. both of which are worthy of considerable additional support and expansion. The PTCs should also be given responsibility for helping to back-stop the newly reorganized system of DOLE's apprenticeship training and to enable the increase of relevancy of skills being taught, particularly through multi-skill developments. 3.6 The role of BTVE in the training of industrial craftsmen and opera- tives should be reassessed. While there is a clear case for BTVE development of technician training and above, no such evidence exists at the lower levels of manpower training. BTVE's problems relate to relevance (paras. 3.14 and 3.16) efficiency of delivery (paras. 3.19, 3.25 and 3.41) and finance (paras. 3.26, 3.38). :;otwithstanding recent efforts to improve BTVE, its one- and two-year courses are doubtful vehicles for new investment and, except where local political constraints delay the termination of this type of training, there should be a timely decline of public funding for such programs. 3.7 Rural Training. Expansion of vocational training in rural areas aimed at wage employment and self-employment would be best carried out through CTP, BNFE basic, non-formal training, and programs organized by NGOs in the private sector. i.  950-22(2) SR044VOC.SEC JP(4)tMSG(2):BWC(2)iDB(2)t 01-24-90 - 23 - 3.8 Grass-root training, however, needs to be further diversified. Although 46 different subjects covering basic industrial training, cottage skills training, and livelihood skills training have been approved or are in preparation, in practice, each local community typically offers only three or four traditional courses. At the same time, additional trainers and materials would be needed for diversification, which is beyond the existing capacity of local community resources (and of NKYC Regional Offices, as the PMDOs and the RTOs are already over-stretched.) 3.9 To help in this respect, NMYC should continue expanding its basic CTC program and should extend the range of subjects offered in the light of the core demand for training and self-employment. Given the basic rural personnel infrastructure, the NHYC could also increase trainee throughput over the next four years, from 21,000 trainees a year to 100,000 61 trainees a year, both to help satisfy effective labor market and social demand for wage and particularly self-employment. This would incidentally make the operation more cost-effective (21,000 trainees a year is not sufficiently cost-effective for a national training body with a regional and local staffing structure). Central funding of the program will need to be increased initially, but the strategy of passing control and ultimate funding over to local organizations should continue. In order to develop this program, full-time staff need to be redirected to the Regional Offices to manage CTCs; the present arrangement of attaching CTC development to PMDOs, who are already busy with other mainstream training work, means that CTCs are not accorded priority as they are perceived as an addition to the regular program. 3.10 Training provided by government agencies should concentrate on satisfying demand for the "core subject" training, because its easy replication suits centralized organizational structures and methods. It would be appropriate for government agencies to provide permanent and replicable non-formal training courses in the main population centers (towns of, say, more than 20,000 population). In towns where CTCs are established, they should form the basis for the government training effort. Elsewhere, coordination of activities between government agencies is required so tiaat subjects and geographical areas are covered adequately without duplication. 3.11 The Government should encourage and support NGOs so that they can supply non-formal training in areas i.e., subjects, geographical locations, and sections of the population that cannot be otherwise reached. NGOs should be consulted about plans for training and should have representation on appropriate bodies (for example, the National Committee for Non-Formal Education). 6/ Assumed by the mission to be a minimum estimate based on field observation of rural employment opportunities and the success of existing courses in placing trainees. Local surveys would provide a sounder basis for CTC expansion and should be undertaken by NHYC.  #50-22(2) SR044VOC.SEC JP(4):MSG(2)sBWC(2):DB(2)s 01-24-90 - 24 - B. Imrovina Relevance and Quality of Trainina 3.12 The issues posed in the previous section are essentially quantitative, basically, how to expand training for modern industry and rural economic development. Twin quality questions call for answers. Is the training being given relevant to the needs of industry or the rural situa- tion? If it is, is it of the required quality? If it is not, how far is this issue a reflection of trainer quality and/or poor facilities and equipment. Relevance of Industrial Trainina 3.13 Recent tracer study evidence on Job placement is lacking for all training agencies. The results of the small employers' survey conducted by the mission must be treated with caution. However, the long waiting lists for entry to NMYC's RTC/PTC programs, the result of of old tracer work (1986) which show about 701 of new NMYC graduates getting jobs in the informal and small firm job market, and the positive attitude of emplolyers in the survey toward NMYC graduates suggest that in relation to industrial needs, the programs are typically relevant. Employers, however, commented that NMYC courses could be improved by broadening the range of skills with more multi- skill course offerings so that trainees would be less specialized and thus local employment needs more adequately met. 3.14 As is typical of education ministries in many countries, BTVE is characterized by a built-in inflexibility in its formal and institutionalized training, fixed heavy equipment, traditional curricula and instruction. weak industrial links and poorer quality trainers, producing less relevant courses and poorer quality graduates. However, these problems are recognized by BTVE and important steps have been taken this year to correct them, including working closely with NMYC, DTI and DOA to improve quality end relevance of training; establishing technical advisory committees in each school, with local industrial representation; revising the curricula for the one- and two- year courses to increase the time spent on practical training, where possible within industry; and strengthening trainer training. It is, however, to early to evaluate impact and it is doubtful if any measure of significant improvement will result. 3.15 NMYC's CTC and outreach courses for rural enterprise basic skills and self-employment (no fixed premises and light equipment, etc.) are typically useful and well-managed, with graduates gaining wage or self- employment opportunities. The also holds true for the BNFE courses. Programs run by NGOs naturally are highly relevant, as they typically respond directly to a locally perceived training demand. 3.16 Graduate Quality. The issue of BTVE graduate quality is serious. The quality of operative-level graduates from the one- and two-year courses of the BTVE voc-tech schools is generally seen by employers as unsatisfactory in the light of their industrial manpower needs. Employers complained of graduates being poor 'technically' and too theoretical. There is evidence that BTVE graduates who do not proceed on to higher training institutions remaining unemployed and enter Nh-YC courses as a remedial bridge to employment.  #50-22(2) SR044VOC.SEC JP(4):HSG(2):BWC(2):DB(2): 01-24-90 - 25 - 3.17 The quality of NHYC operative/craftsmen courses is reasonable but could be improved. It is suggested that a lengthened course based on a modular system be introduced, by extending sequential six-month courses over a year or more, and that more multi-skill training (i.e., giving trainees a repertoire of skills they can perform) at a greater depth than is currently the case. It is also evident that strengthening of instructors' teaching abilities facilities and materials is urgently needed, dramatically so in the BTVE tech/voc schools, but also in the RTCs. 3.18 Quality of Staff and Staff Trainers. RMTC staff are qualified, particularly be provided, in terms of industrial experience, but could benefit from further training. The Audit Department's 1986 evaluation showed that all instructors had passed relevant trade tests, about half had a bachelor's degree (of which half were in engineering-related subjects), 25Z had experience in industry, and about 40Z had received no training either at home or abroad. 3.19 On the other hand, few instructors in the BTVE schools have industrial experience, though this is being redressed partially through intensified training beginning in 1989. Those that possess industrial experience frequently switch to the private sector, which offers better pay and conditions. 3.20 It is suggested that instructor qualities and pay scales be further improved to ensure ease of recruitment and trainee retention. Efforts in this direction have already begun, along with building up stronger linkages with the labor market by permitting teachers to undertake income-generating work in industry and allowing them time for private work and consultancies without jeopardizing teaching quality. 3.21 Improvement of quality must also be tackled by standardizing and levelling up the qualifications of trainers. A vocational training instructors' licence (VTIL) system and a supporting training of trainers program for basic "licence' training and relevant upgrading would be useful. Care must be taken to avoid introducing the recruitment rigidities which characterize general education. Until now, there has been no VTIL system or exclusive trainer training institute in the country. The NMYC has mainly recruited its instructors from among those having class 3 trade skill certificates with more than two years experience who have passed the technical teacher's examination conducted by the Civil Service Commission. It then sends them on two-month skills upgrade courses, (180 hours) which allow them to gain class 2 trade skill certificates. 3.22 There are three Area Trainer Training Centers (ATTC) throughout the country. Currently, there are 264 skills trainers in RMTCs and PHTCs including NSTC, and 189 trainers in 63 CTCs who have been hired on a contractual basis. The 264 NMYC trainers are reasonably qualified with 10l first class, 32Z second class, and 242 third class skill certificates; 7? are CBT holders and the remaining 27% do not hold certificates. 3.23 It is recommended that NHYC establish a Vocational Training Instructor Licence System by amending the pertinent laws and implementing regulations. The VTIL system should be nationally recognized, with all  tS0-22(2) SR044VOC.. o . (4): (2): ()s (2)Ms - 26 - trainers working for all levels of training centers obtaining their instructor's licence through agreed procedures. All trainers can then be monitored, upgraded and protected in jobs. The potential classification of the VTIL system would be grade 1 to 4 VTI, with grade 4 as the lowest level. Promotion to higher grades would depend on skill certificates and trainers training and development capabilities, and some four years of experience at the current grade. It should be emphasized that the promotion to upper grades should be mado only when the experience and relevant skills certificates requirements are met or a graduation certificate for a recognized course is submitted. 3.24 Trainers at RMTCs and PMTCs should hold more than grade 3 certificates and those at NSTC and ATTC more than grade 2 certificates. The NHYMC instructor upgrading training should be expanded not only from current skills upgrading for third class certificates to higher classes, but also for training and development capabilities. All the upgrade training should be conducted systematically within the VTIL system. In addition, the target population for an instructor's upgrade training should be expanded to include the trainers, training officers and managers working for outside training centers, including BTVE schools and voluntary agency short-term vocational staff. Initial education for trainers might be conducted by DI,S, with upgrading by NMYC. 3.25 Equiment and Facilities. RMTCs are relatively well equipped compared .o BTVE schools, where the little equipment provided is obsolete (some being more than 15 years old). However, PMTCs are unable to provide quality training because of inadequate equipment. In some RMTCs and PMTCs, basic equipment like lathes and milling machines have been left unrepaired due to a lack of spare parts and the expertise to repair them. There is no repair service and no standard training equipment list by course which can be used to assess the availability of necessary equipment. The BTVE tech-voc schools are in massive need of refurbishment and re-equipping. The national network has decayed physically through underfunding. If the tech